Weak picture: The ongoing crisis on the Continent showed up in the UK's disappointing trade figures for October

The economy grew by 0.8 per cent in the past three months as the recovery continued, a report showed yesterday.

The National Institute of Economic and Social Research said output rose at a ‘robust’ rate between September and November.

Separate figures from the Office for National Statistics showed factory production increased by 0.4 per cent in October but exports fell 1.3 per cent as demand from Europe fell.

It came as Christine Lagarde, managing director of the International Monetary Fund, dismissed claims that the crisis in the eurozone is over.

‘There is a palpable sense of optimism in some quarters that the European crisis is over,’ she said.

‘But can a crisis really be over when 12 per cent of the labour force is without a job? When unemployment among the young is in very high double digits, reaching more than 50 per cent in Greece and Spain?

‘And when there is no sign that it is becoming easier for people to pay down their debts? All in all, it is premature to declare victory.’

The ongoing crisis on the Continent showed up in the UK’s disappointing trade figures for October. The deficit on trade in goods – exports minus imports – narrowed from £10.1billion in September to £9.7billion in October as the overall position improved slightly.

But exports fell 1.3 per cent to £24.7billion with sales to the European Union down 3.8 per cent to £12.1billion and shipments to the rest of the world up 1.3 per cent to £12.6billion. David Cameron said it was crucial for the UK ‘to open new trade links and grow our exports’.

Rob Wood, chief UK economist at Berenberg Bank, said: ‘A domestic economy growing much faster than our main trading partner, the eurozone, is not going to be a recipe for rebalancing and an improving trade deficit.’